You have received your judgment, now what? Five ways to enforce your judgment and get paid.
So, you have your judgment – Now you want to collect, let us help!
Individuals and corporations in Small Claims Court can spend anywhere from hundreds to thousands of dollars and countless hours simply preparing, issuing, and serving a Plaintiff’s Claim. In addition, it can take even longer to obtain judgment from the Court. Unfortunately, obtaining your judgment is only half the battle; one the Court will not fight for you. While the Courts do offer a variety of different ways that you can collect your judgment, it is a process that you must complete yourself, or with the help of a hired legal professional.
Our paralegals have countless hours and success stories of how we were able to recover judgments for our clients through the many enforcement options available:
1. Garnishing wages
2. Garnishing bank accounts
3. Garnishing accounts payable
4. Writ of Seizure & Sale of Land
5. Writ of Seizure and Sale of Personal Property
One thing to keep in mind is that once you obtain judgment against the Defendant, they now become the Debtor and you, as the Plaintiff become the Creditor.
1. Garnishing Wages:
If the creditor knows where the debtor is employed, you can send a notice of garnishment to the employer that highlights that you have an issued judgment against one of their employees. Along with an issued garnishment, you would also send them a Garnishee Statement, which they have to fill out, indicating whether the employee is or is not employed and how much they earn on either a weekly, bi-weekly or monthly basis. The employer is also obligated under the garnishment to remit any funds earned by way of tips, commissions, or bonuses.
• A creditor is only entitled to 20% of the debtor’s net wages.
• A creditor cannot garnish employment insurance, social assistance, or pension payments.
• There are also restrictions on garnishing the wages of a Federal or provincial government employee as well as a military member of the Canadian Armed Forces.
2. Garnishing a Bank Account:
The Creditor can issue a bank garnishment if they know the exact branch for which the Debtor has an active bank account. The process is very similar to a wage garnishment, whereas a garnishment will be served upon the bank and they reply via the Garnishee Statement to indicate whether the Debtor does or does not have an active bank account at their location. If the debtor does have an active bank account, they will provide notice of whether the garnishment is being remitted in full or partial. A bank garnishment varies from a wage garnishment because if the debtor’s bank account has the full amount of the judgment, it can all be remitted and not just 20% like you would see with a wage garnishment.
Example: Our client issued a cheque to a body shop to complete repairs on a vehicle that never ended up being completed. Once we obtained judgment for our client, we performed a Skip Trace to try and locate the body shops bank account. We were successful in locating an active bank account, we served the garnishment and received the full amount of the judgment from the bank.
3. Garnishing Accounts Payable (AP)
If the debtor is a corporation and you cannot locate an active bank account, yet, you know that they perform work for their clients, you can send a garnishment directly to their client and garnish any of their accounts payable to the debtor. Basically, instead of the debtor’s client paying the debtor, the payment would go to you instead.
Example: You are a headhunter who did work for an advertising company. You found the advertising company a great employee and now they are refusing to pay your invoice. You know that the advertising company does work for a major grocery store chain. You can send a garnishment to that grocery store chain stating that any account payable that they have to this advertising company need to be paid to yourself first.
4. Writ of Seizure & Sale of Land
If the Creditor is aware that the Debtor owns land in any provincial jurisdiction, they can file a Writ of Seizure & Sale of Land. When a Writ is issued on a Debtors property, it stops them from being able to sell or re-mortgage their land until the debt is paid. If the Debtor owns multiple properties, the Creditor can issue a Writ on each property, respectfully.
Caution: While a Writ of Seizure and Sale of Land can be very effective depending on how many creditors have Writ’s on the same property, it could take years before the debt is collected in full.
5. Writ of Seizure & Sale of Personal Property
If the Creditor does not have any means of enforcing a judgment through a garnishment or if the debtor does not own land, the Creditor can request for the enforcement office to seize specific personal belongings from the Debtor and have them sold at a public auction. Any money recovered from the sale would go to the Creditor in order to pay either the partial or full amount of the judgment.
o Caution: This method of enforcement could prove to be very costly to the Creditor and may not yield the expected results, especially if the Debtor does not have an item that is worth seizing and selling.
If you’re looking for more information or further assistance on starting your legal action, you can schedule a free telephone consultation with one of our paralegals to discuss the ways in which we can assist you in collecting your debt. Click here to schedule your free consultation today!